Paccar manufacturing forecast to 2029

Included on this evaluation:

• Overview
• Working construction
• Latest efficiency
• Strategic plan
• Gross sales
• Manufacturing
• Outlook and forecast to 2029

Overview

Paccar delivered 185,300 vehicles in 2024, following a report 204,200 in 2023. The corporate has paid a yearly dividend since 1941, and its ten-year-average dividend yield stands at 3.9%. It has lengthy had a wholesome money stability, amounting to about US$9.1bn within the truck division on the finish of September 2025, and the division usually operates with zero or negligible debt.

This could be a creditable achievement in any trade, however for an organization uncovered to the marked cyclical swings of the truck trade, notably the North American heavy truck sector, it’s a outstanding feat. This partly displays Paccar’s low degree of integration for a lot of its historical past but additionally a responsive administration that’s not afraid to take powerful choices early on and a disciplined method to M&A alternatives.

Having remained worthwhile throughout the sharp however not catastrophic downturn of 2020, Paccar reported working revenue will increase of 39% for 2021, 65% for 2022 and 75% for 2023. This era of revenue progress got here to an finish in 2024, with a 17.6% drop in group working revenue as core markets turned down.

The corporate is heading for a sharper fall in 2025, with key truck markets presently affected by unsure financial circumstances and the influence of tariffs and commerce disruption. On the similar time, Paccar has the pliability to react and the resilience to face up to such challenges.

Working construction

Paccar’s main enterprise stays the manufacturing and sale of vehicles and components. This enterprise accounted for practically 94% of group income and 84% of pre-tax revenue in 2024.

As Paccar has begun to provide extra engines in-house, the components division has outperformed in recent times. In 2024, the division contributed 19.8% of group income and practically 32% of group pre-tax revenue. Throughout that very same yr, the corporate was additionally concerned in:

• finance and leasing, principally however not completely of its personal automobiles—this division had belongings of US$22.4bn on the finish of 2024, up from US$21bn in 2023;
• the manufacturing of commercial winches beneath the Braden, Gearmatic and Carco nameplates—bought in October 2024, leading to a pre-tax acquire of US$14m.

Paccar (Manufacturing) income & working revenue development

Latest efficiency

Paccar’s outcomes for 2024 had been, as ever, fairly simple. It’s uncommon for the corporate to supply adjusted revenue figures within the headline and make buyers dig down to search out the reported figures.

Income within the industrial enterprise fell by 5.3% to US$31.6bn, together with a 7.5% decline within the truck division to US$24.8bn partly offset by a 3.9% rise within the components division to US$6.7bn. The autumn in truck income mirrored a 9.2% fall in deliveries to 185,300 items from the prior yr’s report 204,200 items. The finance division reported a 15.9% improve in income to US$2.1bn, primarily helped by portfolio progress and better portfolio yields.

Pre-tax revenue within the truck division fell 25% to US$2.85bn from a report US$3.8bn in 2023, primarily reflecting the income decline and better uncooked materials and labour prices, partly offset by improved web pricing and decrease guarantee prices. Pre-tax revenue within the components division edged 1.1% increased to US$1.7bn, however the monetary companies division reported a 19.4% fall to US$435.6m, the second yr of decline having reached a report degree in 2022. Group web revenue fell 9.5% to US$4.16bn having reached a report US$4.6bn in 2023.

Over the primary 9 months of 2025, pre-tax revenue within the truck division fell extra sharply, down 53% to US$1.69bn as demand contracted in all Paccar’s core markets. The decline included a US$350m cost associated to civil litigation in Europe in Q1 2025—ongoing fallout from the European Fee’s 2016 determination that a number of main truckmakers operated a price-fixing cartel. Excluding this, recurring revenue dropped 44%.

Strategic plan

Paccar’s focus is an easy one: ship glorious monetary efficiency all through the enterprise cycle, with best-in-class working effectivity. It sees high quality, know-how and innovation because the foundations for its worthwhile progress beneath three predominant headings:

• Premium vehicles;
• Efficient transportation options;
• Market growth, together with constructing share in present markets and increasing into new ones.

There was a lot debate when Paccar acquired Dutch agency Daf in 1996 as to how the 2 corporations’ enterprise fashions would reconcile: Paccar’s very low integration method, in contrast with Daf’s excessive degree. For the primary 15 years or so, the 2 approaches labored high quality on totally different sides of the Atlantic. Nevertheless, there was a major change in 2010 with the launch of the Daf-developed MX engine in North America. The MX was initially imported however is now constructed at an engine plant in Mississippi.

If the acquisition of Daf was the primary main strategic shift of the previous 30-plus years, then the swap to in-house engines was the second. By the tip of 2024, cumulative manufacturing of MX engines exceeded 1.2 million items. Paccar, which used to have a protracted aversion to vertical integration, now trumpets its advantages in company shows. Different examples embody the event of a proprietary drive axle and a brand new automated transmission.

Gross sales

The US has historically been Paccar’s largest single market when it comes to each gross sales and profitability. In 2024, North American income was three-times increased than Europe.

In 2024, the corporate delivered 106,400 vehicles (a fall of two.5% year-on-year) within the US and Canada, the place it operates beneath the Kenworth and Peterbilt model names. Retail gross sales within the US of Kenworth vehicles had been 0.4% increased at 46,100 items, reflecting:

• Class 8 gross sales down 6.7% to 36,600 items;
• Class 7 up 45% to six,140 items;
• Class 6 up 39% at 3,300 items;
• Class 5 down 8 items at 19 items.

Peterbilt bought 0.5% extra vehicles at 47,220 items, reflecting:

• Class 8 down 4.8% at 37,830 items;
• Class 7 up 35% at 6,470 items;
• Class 6 up 18.5% at 2,920 items;
• Class 5 gross sales of 4 items in contrast with 15 in 2023.

Over the primary 9 months of 2025, world deliveries declined by 21% to 111,300 items, reflecting falls of 26% in North America (US and Canada) to 62,300 items and 6% in Europe to 31,100 items. In different areas—together with Mexico, South America and Australia—deliveries fell by 26% to 17,900 items.

Electrical automobiles

Paccar has been trialling quite a lot of battery- and gasoline cell-powered automobiles in recent times, all based mostly on present fashions. Talking on the time of the corporate’s This autumn 2022 outcomes, Chief Government Preston Feight stated: “We expect [annual electric truck sales will] keep within the a whole bunch for a short while, after which as laws are available in and experiences develop into extra acquainted, it’ll develop into the 1000’s and lengthen from there. We’re effectively positioned for that progress.” So far, his forecast appears to be like sound: in 2023 and 2024, Paccar delivered fewer than 500 battery-electric vehicles.

The corporate has a strategic partnership with Aurora to develop, take a look at and commercialise autonomous Peterbilt and Kenworth vehicles. In September 2021, a industrial pilot was arrange with Aurora and FedEx for autonomously enabled vehicles to haul FedEx hundreds between Dallas and Houston, a 500-mile spherical journey. The primary totally driverless journeys between Dallas and Houston had been accomplished in April 2025. Volvo can be working with Aurora.

Manufacturing

In Europe, Daf produced 47,600 items in 2024, down 32% from 2023’s report degree. Along with the truck and engine meeting amenities at Eindhoven within the Netherlands, Daf manufactures cabs and axles at Westerlo in Belgium. Within the UK, the Leyland facility assembles all the XB light-truck vary and RHD variations of different fashions for the UK and RHD export markets.

In North America, Paccar now operates:

• three truck meeting crops within the US: Kenworth crops at Chillicothe, Ohio, and Renton, Washington, and Peterbilt’s plant at Denton, Texas;
• one in Canada: Sainte-Therese, the place medium vehicles are assembled;
• and one in Mexico: San Luis Mexicali.

Throughout 2025, some 725 workers at Sainte-Therese have been laid off, together with 300 in October. This has left the plant with a workforce of round 550, producing simply 18 vehicles per day in contrast with round 90 at full capability. Automotive World anticipates an extra drop within the plant’s output throughout 2026 earlier than a restoration begins in 2027, however there have to be a threat that the plant shall be shuttered.

In July 2024, Amplify Cell Applied sciences—a joint-venture between Accelera (a Cummins division), Daimler Truck, and Paccar—broke floor on a website in Mississippi for a complicated battery cell manufacturing plant. The 21 GWh plant was scheduled to start operations in 2027, however the start-date has been pushed again to not less than 2028.

Daf Brasil’s US$200m facility in Ponta Grossa, Paraná state, formally began manufacturing in early October 2013. It produces vehicles for Brazil and your complete Latin American market, that are distributed by way of a community of impartial Daf sellers. Throughout 2024, Daf Brasil produced a report 10,600 vehicles and achieved a report 9.9% market share in Brazil’s 16t-plus market.

In Taiwan, the Formosa Car Gross sales Company has assembled Daf fashions since 2006, with all fashions equipped in equipment type from the Netherlands or UK. Output in 2024 was about 345 items in contrast with 630 in 2023 and 1,240 in 2022. Such equipment meeting will not be included within the manufacturing forecast to keep away from double-counting.

Outlook and forecast to 2029

Paccar’s world truck output is about to fall for the second successive yr in 2025, introduced decrease primarily by falling demand in all its core markets. Automotive World anticipates an almost 16% decline total to 159,000 items, with a steeper decline within the USMCA area and a milder drop in Europe, the place manufacturing was already sharply decrease in 2024.

A gentle restoration is anticipated to start in 2026, with demand in North America and Europe anticipated to select up within the second half of the yr. In each areas, gross sales progress is principally anticipated to be generated by substitute demand as truck fleets age, moderately than any vital growth of capability by hauliers.

An acceleration within the fee of output progress is forecast for 2027 and 2028, although the anticipated fee of progress in world output stays in single digits for each years.

Within the case of Europe alone, a pre-buy impact is anticipated to spice up output by round 16% in 2028, prematurely of Euro 7 emission requirements making use of to all new vehicles from Could 2029. The pre-buy enhance shall be adopted a post-buy decline in 2029. It needs to be famous that Euro 7’s newly launched limits on particulate emissions past the exhaust pipe, primarily brakes and tyres, won’t come into pressure till 2030-32.

In the meantime, a beforehand anticipated pre-buy impact within the US, in response to 2027 emission regulation modifications, has been set again by authorized challenges and political pushback, which the Environmental Safety Company is presently re-evaluating. With the subsequent US election not due till 2028, the introduction of harder emission laws inside the forecast interval appears to be like unlikely.

In Brazil, 2025 is anticipated to characterize a low-point for Daf’s output, which is forecast to rise steadily between 2026-29 however stay beneath the 2024 peak that included an emissions-related pre-buy impact.

Though Paccar’s world output within the 5 years to 2029 is anticipated to stay beneath the 2023 peak of 205,000 items, cumulative manufacturing over the interval is anticipated to rise to just about 900,000 items, 2.7% forward of the prior five-year interval.

Paccar vehicles manufacturing by nation, 2020-29 (000s)

Paccar manufacturing forecast by model, 2020-29 (000s)